India is going to take over the world. India produces so many engineers each year. Indians have filed so many patents in the United States. They are now doing cutting edge research in pharmaceuticals and semiconductors….blah, blah, blah…
In recent weeks, the stories in various publications make it appear that somehow India will rule the rest of the world because it has too many people who are not only consumers of all kinds of goods and services but can also produce everything cheap. And thus, India is a threat.
While I agree that a country that was living in a black hole for decades does present some interesting business opportunities after liberalization of its markets, but anything beyond that is mere hype perpetrated by a group of Indian-Americans and magazines that look for shock value. Those of us who are old enough to remember the Asian Tigers know very well how bubbles start and what happens when the bubble bursts.
Pankaj Mishra, the author of “Temptations of the West: How to Be Modern in India, Pakistan, Tibet and Beyond,” in an article in the New York Times under the title “The Myth of the New India,” may very well have started the process of exposing the hype. I am glad that he prompted me to share my thoughts.
Just to put it all in perspective and to make Lou Dobbs feel better, India’s GDP is just 5% of the US GDP with more than three times the people. Actually, we spend more than double the amount of Indian GDP on healthcare alone in the United States. While there is a so-called Indian middle class emerging that is buying cars and dining in McDonald’s restaurants, imagine a country larger than the United States living for less than a dollar a day. That’s right! Close to four out of ten Indians live like that. India also has practically no infrastructure to talk about in terms of roads, electricity, water supply, public safety, telecom, etc. And if you were worried about Indians taking over the world of technology, calm down. India has just 50 million Internet users compared to over 200 million in America. (Related: India business model)
Indeed, India will take away some of the low end jobs from us (and it is good for everyone), but everything else is nothing but hype. For those of us in the business world worried about growth and value, the opportunity in the US is just too large to get too excited by small markets like India. However, as any smart business leader knows, diversification is good and I would say that you must do your own analysis to justify a footprint in India – it’s just that India is not as big an opportunity for most global corporations as is made out to be.